Multiple Choice
The supply and demand curves for a product are as follows. What is producer surplus in this market?
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5. Consumer and Producer Surplus; Price Ceilings and Floors
Quantitative Analysis of Consumer and Producer Surplus at Equilibrium
Multiple Choice
How many calls a customer service agent can handle per hour is an example of which type of constraint in the quantitative analysis of consumer and producer surplus at equilibrium?
A
A subsidy
B
A demand curve shift
C
A capacity constraint
D
A price ceiling
Verified step by step guidance1
Understand the context of the problem: it asks about the type of constraint represented by the number of calls a customer service agent can handle per hour.
Recall that in microeconomics, constraints limit the ability of consumers or producers to adjust quantities or prices freely.
Identify that a subsidy is a financial support that lowers costs, and a demand curve shift refers to changes in consumer preferences or income, neither of which directly limit capacity.
Recognize that a price ceiling is a legal maximum price, which restricts prices but not quantities handled by an agent.
Conclude that the number of calls an agent can handle per hour is a physical or operational limit on production capacity, which is known as a capacity constraint.
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